Health reform initiative closing early

The health reform law’s Early Retiree Reinsurance Program is so popular it’s going to have to retire — early.

One of the Affordable Care Act’s most popular programs will no longer accept applications after April 30, according to a CMS memo to congressional staff obtained by POLITICO Thursday.

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The program was given $5 billion in the health care overhaul and was supposed to stay open no later than 2014, when the exchanges come online. But the money is expected to run out by the end of September 2012, and the administration is shutting down enrollment early so the money lasts until then.

Administration officials said that employers already enrolled in the program will continue to receive their approved funds, which have to be used by December 2013. The program will not technically close until then, the officials said.

CMS said the news was a sign of the popularity of the program. Critics of the law are likely to argue that it’s a sign the legislation was underfunded.

“Today’s report demonstrates both the popularity and success of the program and also builds on previously collected data, which revealed that 97 percent of the ERRP reimbursements were used to help reduce health insurance costs for retirees and their families — putting dollars back into consumers’ hands,” the CMS memo reads.

The ERRP program has provided more than 1,300 employers with nearly $1.8 billion in reimbursements to help ensure access to health benefits for early retirees, according to the CMS memo.

A report compiled by Republicans on the Energy and Commerce's oversight subcommittee this month estimated the program would run out of funds “long before” 2014. It cited CCIIO estimates that the program would exhaust funds in 2012.

UPDATE: This story has been updated to clarify when the program will close.

This article first appeared on POLITICO Pro at 5:12 p.m. on March 31, 2011.